Project Baselines

A. Definition

Baseline is a defined and agreed starting point of implementation and for a future measurement and comparison.
Project Baseline is a basis of contractual responsibility which is clearly defined and agreed between contract parties prior to commencement of the project, and is a fundamental basis of measurement of the project completeness. The Project Baseline is a project management and control tool to help a solid understanding of the project for all internal and external project members.
The Project Baseline Document is initially developed by a proposal team and further updated by a project execution team during the project execution. The Baseline Document should be prepared and developed with accurate information and implemented from the project kick-off, however it can be started with existing materials that have been prepared for the proposal and developed for the project initiation, and should be updated as per the detailed project planning and execution under the project manager’s responsibility.
Practically, the Project Baseline consists of Contract Basis; Scope of Work; Project Schedule; Commercial terms and conditions; Project Execution Plan (PEP) include Project Risk Management, and other critical specific requirements of the project.

B. Content of the Project Baseline

Contract Basis: A Contract is an agreement between two or more parties, to exchange providing a specific work (Scope of Work) with agreed compensations (cost, time duration and any others specified in the contract) include terms and conditions. The Contract terms and conditions including both parties' obligation, liability, payment, and other terms and conditions are legally binded. The Baseline document of Contract is a summary of contract terms and conditions, focused on the directly involved in the project execution (liability, payment and change management, etc.), and prepared to the project language and terminology rather that the legal.

Scope of Work (SOW) is a contractor to provide works (tangible and or intangible) against the owner’s compensations based on the contract and related terms and conditions. The SOW can be defined as Scope of Facility (hardware) and Scope of Service (software)). A Contract Scope of Work is a foundation of the Project Baseline. The SOW document was initiated by owner included in the ITB, and developed and proposed by contractor, and finalized after clarification and negotiation discussion between owner and contractor, and included in the Contract document. A project execution people including the Project Manager should review the Project Scope of Work document and buy them before the contract is signed.
The SOW can be further detailed as a Scope of Facility (SOF) and Scope of Service (SOS)
Scope of Facility (SOF) is mainly tangible asset. The baseline document of SOF is brief overview of the project facilities to be designed and constructed under the contact, and clearly define the plants or units capacities and technology including process performance and utility consumption. Major critical equipment and equipment list can be added. Owner provide items should be listed.
Scope of Service (SOS) is an effort services (intangible) based on experience and knowledge. The baseline document of SOS is a brief overview of the services to be provided including specific major activities in project management, engineering, procurement service and construction management services, and so on. The SOS baseline document can be specified estimated resources amount and mobilization plan.

Schedule is a time and resource control and management tool, identify activities for entire project with time scales and required resources. The Schedule is a plan for completion of a project, list of planned activities to be done within allowed time frame.) Initially, for the Project Baseline document for Schedule can be used as a proposal document, Level 1 (Project Master Schedule) or Level 2 (Project Summary Schedule) indicating entire project time frame and contractual key milestones. The Baseline Schedule, usually Control Level Schedule (Level 3) should be developed during the project planning and early execution stage, Level 1 or Level 2 Schedule with the project key milestones roll down into the Project Control Level Schedule.

Commercial (Cost)
Proposal Cost Estimate Basis such as basis of the proposal development (design and engineering document, etc.), staffing plan, tagged item list and quantity, bulk material BM take off, equipment, material and subcontractors pricing basis, execution plan, and applied company over head and profits, and other commercial basis, bond, insurance, tax, etc. should be documented and updated them as necessary during the contract clarification and negotiation discussions with owner, and hand-over to the project team for the Commercial Baseline. The Commercial Baseline document should include the Project Risk Management cost, any allowances and project contingencies.

Project Execution Plan (PEP) is one of the project baseline document and the governing document that establishes the means to execute, monitor, and control projects for the project operation and management. The PEP describes a project specific plan addressing the most effective method and maximise efficiency in the project execution, and the project specific actions have to be described complying with project goals, objectives and strategies. The PEP defines a clear scope of work and other critical responsibilities as agreed in the contract, and how work to be done is in accordance with the company policies. The PEP is developed by the project key participants led by the Project Manager. The PEP should be approved by company management prior to publishing or applying. The PEP is a live document and should be updated with current and future project plans and procedures.) The PEP includes detailed Project Risk (A Risk is a possibility of negative impact happening, and an unknown event or a situation of uncertainty) management plan including risk items and mitigation plans which was assessed and evaluated during the proposal stage, and action plans for the project execution in accordance with the company risk management procedure.

C. Project Baseline Work Process

Baseline Planning Process: The Project Manager establishes the PEP with consideration of project constraints (cost, schedule and quality/ safety) and project requirements to achieve the project goals and objectives.
Baseline Documentation: The Project Baseline Document is not a separate project plan or procedure. These are updated proposal information and developed plans during a project initiation and planning stage.
Baseline Implementation: The Project Baseline should be approved by company management prior to implementation as well as recommended to have an agreement with owner. The Baseline Document is a base of the project execution, document should be allowed project key personnel to easily access.
Baseline Update: The Project Manager with project key personnel’ supporting is a responsible for updating and maintaining with latest information. Any Variations should be recorded and reported.

D. Other

Development of the Project Baseline: Guideline and Template to be developed and introduced by experts.